Corporate Layoffs Vanish, Job Losses Decline

I've been showing this chart since early this year, saying that it was a good indicator of improvement in the economy. Corporate layoff announcements (which are presumably a fairly accurate gauge of distress in the large corporate sector of the economy) are now down to levels that in the past have been consistent with healthy economic growth. The storm has clearly passed. The next shoe to drop will be net new hirings. Earlier this year I called this a "green shoot," and now it's beginning to look like a V-sign. Not quite yet, but potentially, if the next phase for corporate America is new hiring campaigns.

I'll say the same thing as last month about this chart. According to the ADP survey, job losses in November were lower than the previous months, but the corresponding job loss number to be released this Friday is likely to be not quite as low as the market is currently expecting (-123K according to Bloomberg). Nevertheless, the important thing is that we are seeing continuing improvement, albeit of the slow variety. This supports the widely held view that the unemployment rate is going to remain uncomfortably high for quite some time—well into next year.